Prepay letters

Discussion in 'Pesticide & Herbicide Application' started by rcreech, Dec 27, 2007.

  1. rcreech

    rcreech Sponsor
    Male, from OHIO
    Posts: 6,057

    This is going to be my first year offering a prepay program to my customers.

    When do you guys send out your prepay letter and what is a typical discount for prepay?

    What % of your customers use a prepay program?

  2. yardmanlee

    yardmanlee LawnSite Senior Member
    Posts: 898

    we usually send out a news letter first of Jan explaining the diffrent types of payment programs we offer then another in march, we offer 10% discount on pre-paid mowing services only if paid by march 15 and then a 10 % on mulch jobs if done before march 31
    we start mowing around the 1st to 2nd week in april. in the
    janurary news letter I will be pushing monthly contracts or budget plan. so I can have some income coming in jan and feb
  3. ted putnam

    ted putnam LawnSite Platinum Member
    Posts: 4,539

    I am printing my letters and envelopes as I write this. I will send mine out tommorrow . so they will be there the 1st. What a pain. but worth it.I spend about $300 postage and all but last year I got about 17k. Worked out to about 14%. I offer a 5% discount. Mostly little old ladies that don't want to spend money on stamps. I would much rather get the money a little at a time but it sure does help get the ball rolling.
  4. FdLLawnMan

    FdLLawnMan LawnSite Bronze Member
    Posts: 1,182

    I have to do it because the big guys around here do it so it is expected. I give a 5% discount to all 4 step customers and 7% to all 5 & 6 step customers. I send them out in February and they need to be paid by April 1. I would say about 1/3 to 1/2 take advantage of the prepay. I also have has several people request that I accept credit cards so I will offer that this year. I will have their credit card number on record and will charge them one week after the application. I will see how that goes. The prepay helps pay for the fertilizer order that needs to be paid in March.
  5. carcrz

    carcrz LawnSite Silver Member
    Posts: 2,085

    5%, but I only got a handful to bite this last year as it was the first go around for prepaying.
  6. turf hokie

    turf hokie LawnSite Silver Member
    Posts: 2,744

    5% by March 15, about 15% take advantage.
  7. BonesMalone

    BonesMalone LawnSite Member
    Posts: 46

    10% by March 15. I send letters out middle of January. The last two years prepays amounted to almost 60% of total annual fert & squirt business. It brings in a lot of income before season starts. Make sure you use this income wisely, its a long time till last apps.
  8. whoopassonthebluegrass

    whoopassonthebluegrass LawnSite Platinum Member
    Posts: 4,214

    I offer 2 stages:

    In November we send one out and offer 10% with 2 free add-on sprays.

    Then in late Jan/early Feb we send another with just the 10%.

    I don't like to do it, but our season is short enough that I need the money for winter. We're finally big enough now, though, that we'll likely taper it back this next year.

    I prefer the fall signup b/c it beats out any competitors wowing my customers with unrealistically low pricing.
  9. garydale

    garydale LawnSite Senior Member
    Posts: 813

    We mail prepays on December 1st each year.

    We offer a three tier program:

    10% if paid by 12/31/07
    7% if paid by 01/31/08
    5% if paid by 02/29/08

    Only 55% of total customer base prepays, with 75% of those by 12/31/07 to get the 10% discount.
    Further, we allow a one time $5.00 senior discount with prepay. (60 and older)

    Our goals are to:
    •Cash flow
    •Money for bulk purchases
    •Lock in accounts before spring sales pitches hit.
    •Major competition was mailing early also

    This is our 12th year doing this and we plan to continue.
  10. lawnservice

    lawnservice LawnSite Senior Member
    Posts: 589

    our prepay letters go out mid Dec. We shut down last two weeks in Dec and first week in Jan...letters must be in the mail before shut down

    we offer 7% if paid by Feb. 20

    every letter has an optional service offer (some might be aeration, others might be deep root tree/shrub feeding, basicly whatever service they did not get last season)
    we offer 10% if the customer bites on our 'optional service offer' by 2/20
    33% prepay us

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